The link is expected to be launched by the end of year, said Charles Li, CEO of Hong Kong Exchanges and Clearing, the city’s stock market operator. He said over the next three to four months, the stock exchange would conduct technical preparations and testing, update regulations and raise investor awareness, and then await the announcement of a launch date from regulators.

Hong Kong is Chinese territory but its financial system is open to foreign investors, while mainland markets are largely sealed off from global capital flows. Beijing has long used the former British colony as an offshore outpost for financial interaction with foreign companies and investors.

A similar measure linking Hong Kong with the mainland’s main exchange in Shanghai was launched in 2014. It allows investors from both cities to buy a limited range of stocks from the other side.

“Based on the success of the Shanghai-Hong Kong link, the launch of the Shenzhen-Hong Kong link marks a concrete step toward making Chinese capital markets more law-based, market-oriented and globalized,” Premier Li Keqiang, the country’s top economic official, said in the statement.

Li said the move will increase China’s international economic links while shoring up Hong Kong’s position as a financial center.

“Today the main point is that we have made the bridges meet and we will be able to expand to further products in the future,” Li told reporters at a late-evening news conference. He said that now that Hong Kong’s exchange has set up infrastructure for accessing secondary markets, it could expand into commodities, bonds or currencies. “These we would do step by step,” he added.

Until the launch of the Shanghai-Hong Kong link, only a few foreign institutions were allowed to buy mainland-traded shares in a closely regulated system.

The Shanghai-Hong Kong link was hugely popular with foreign investors, who bought the maximum number of shares allowed in its first few days. The measure was less popular on the mainland, where investors have other vehicles for sending money abroad to invest.

Mainland stock prices soared beginning in late 2014 and then collapsed in mid-2015, triggering a panicked, multi-billion-dollar government share-buying effort to stabilize prices.

Li dismissed fears that Hong Kong’s trading systems would be unable to handle the volatility if there’s a repeat of the market meltdown across the border, saying it’s no reason to delay the launch.

“Crises happen all the time,” he said. Markets “have been selling off, they have been going up. I don’t really see why that’s going to be a determining factor at this point, but again, we’re talking about the future. Anything could happen in the future.”

The Shenzhen market is smaller than Shanghai’s and many of its listed shares are in smaller technology and consumer-oriented companies. The city, which borders Hong Kong, led China’s export boom that began in the 1980s.

Under the new link, Hong Kong investors will be able to trade 880 stocks on the Shenzhen market, although 200 of those shares on the Nasdaq-style tech-heavy Chinext board will only be open to institutional professional investors at first.

Mainland investors will be able to trade 417 Hong Kong small cap stocks through the Shenzhen exchange.

There will be a daily quota limiting the maximum value of cross-border trades, similar to one in place with the Shanghai-Hong Kong link aimed at limiting volatility. Another broader trading quota will be dropped for both trading links.